SCHEDULE 14A INFORMATION
(RULE 14A)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a 6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
PLANET HOLLYWOOD INTERNATIONAL, INC.
(Name of Registrant as Specified in its Charter)
(Name of Person(s) Filing Proxy Statement, other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which the transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total Fee Paid:
-----------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
---------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[PLANET HOLLYWOOD LOGO]
PLANET HOLLYWOOD INTERNATIONAL, INC.
ANNUAL MEETING OF STOCKHOLDERS
MAY 27, 1999
----------------------------------------------------------
NOTICE AND PROXY STATEMENT
<PAGE>
[PLANET HOLLYWOOD LOGO]
April 28, 1999
Dear Planet Hollywood Stockholder:
I am pleased to invite you to Planet Hollywood International, Inc's Annual
Meeting of Stockholders. The meeting will be held on Thursday, May 27, 1999 at
10:00 a.m. (local time) at the Clarion Plaza Hotel, 9700 International Drive,
Orlando, Florida 32819 in Ballroom C.
At the meeting, you and the other stockholders will elect three directors
to the Planet Hollywood International, Inc. Board of Directors. You will also
have the opportunity to hear what has happened in our business in the past year
and to ask questions. Other detailed information about Planet Hollywood and its
operations, including its audited financial statements, are included in our
Annual Report which was previously delivered to you.
We hope you can join us on May 27th. Whether or not you can attend, please
read the enclosed Proxy Statement. When you have done so, please MARK your
votes on the enclosed proxy card, SIGN AND DATE IT, and RETURN IT to us in the
enclosed postage-paid envelope. Your vote is important, so please return your
proxy card promptly.
Sincerely,
ROBERT EARL
Chairman of the Board
<PAGE>
PLANET HOLLYWOOD INTERNATIONAL, INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 27, 1999
Planet Hollywood International, Inc. will hold its Annual Meeting of
Stockholders on Thursday, May 27, 1999 at 10:00 a.m. (local time) at:
Clarion Plaza Hotel
9700 International Drive
Ballroom C
Orlando, Florida 32819
We are holding this meeting to consider and act upon the following matters
which are more fully described in the accompanying Proxy Statement:
1. The election of three directors (Class III directors) to the Company's
Board of Directors.
2. Such other business as may properly come before the meeting or any
adjournment thereof.
The Board of Directors has selected April 23, 1999 as the record date for
determining stockholders entitled to notice of and to vote at the meeting and
any adjournment thereof. A list of stockholders on that date will be available
for inspection at the Company's corporate headquarters, for ten days before the
meeting. The stock transfer books of the Company will not be closed.
IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING,
PLEASE DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED
PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
By Order of the Board of
Directors,
SCOTT E. JOHNSON
Secretary
Orlando, Florida
April 28, 1999
<PAGE>
PLANET HOLLYWOOD INTERNATIONAL, INC.
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 27, 1999
This Proxy Statement is furnished to stockholders of Planet Hollywood
International, Inc. for use at the Annual Meeting of Stockholders to be held at
10:00 a.m. (local time) on May 27, 1999, at the Clarion Plaza Hotel, 9700
International Drive, Orlando, Florida 32819 in Ballroom C, or at any
postponements or adjournments thereof for the purposes set forth in the
accompanying Notice of Annual Meeting of Stockholders. The approximate date on
which this Proxy Statement and the enclosed proxy card are first being sent to
stockholders is April 28, 1999.
TABLE OF CONTENTS
<TABLE>
<S> <C>
General Information .................................................................. 2
Election of Directors ................................................................ 4
Nominees for Election for a Three-Year Term (Class III Directors) .................. 4
Class I Directors Continuing in Office Until the 2000 Annual Meeting ............... 5
Class II Directors Continuing in Office Until the 2001 Annual Meeting .............. 6
Meetings of the Board of Directors and its Committees .............................. 7
Executive Officers Who Do Not Serve as Directors ................................... 8
Stock Ownership ...................................................................... 10
Beneficial Ownership of Certain Stockholders, Directors and Executive Officers ..... 10
Section 16(a) Beneficial Ownership Reporting Compliance ............................ 12
Executive Compensation ............................................................... 13
Summary Compensation Table ......................................................... 13
Option / SAR Grants Table .......................................................... 14
Aggregated Option / SAR Exercises and 1998 Fiscal Year-End Option / SAR
Value Table ...................................................................... 15
Compensation of Directors .......................................................... 15
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements ..................................................................... 16
Certain Relationships and Related Transactions ..................................... 18
Report on Repricing of Options / SARs .............................................. 20
Insider Participation in Compensation Decisions and Board Compensation Committee
Report on Executive Compensation ................................................. 21
Stock Performance Graph ............................................................ 23
Auditors ............................................................................. 24
Other Business ....................................................................... 24
</TABLE>
1
<PAGE>
GENERAL INFORMATION
1. Q: WHO IS SOLICITING MY PROXY?
A: We - the Board of Directors of Planet Hollywood - are sending you
this Proxy Statement in connection with our solicitation of
proxies for use at Planet Hollywood's 1999 Annual Meeting of
Stockholders. Certain directors, officers and employees of Planet
Hollywood also may solicit proxies on our behalf by mail, phone,
fax or in person.
2. Q: WHO IS PAYING FOR THIS SOLICITATION?
A: Planet Hollywood will pay for the solicitation of proxies,
including the cost of preparing, assembling and mailing this
Proxy Statement, the proxy card, the Annual Report and all other
material which may be sent to stockholders in connection with
this solicitation.
3. Q: WHAT AM I VOTING ON?
A: The election of William H. Baumhauer, Robert Earl and Michael
Tarnopol to the Board of Directors (Class III Directors).
4. Q: WHO CAN VOTE?
A: Only those who owned Planet Hollywood Class A Common Stock at the
close of business on April 23, 1999, the record date for the
Annual Meeting, can vote. If you beneficially owned any Class A
Common Stock on the record date, you have one vote per share for
each director up for election at the Annual Meeting. Under the
Securities and Exchange Commission's definition, "beneficial
ownership" of shares means shares over which a person has sole or
shared voting or investment power.
5. Q: HOW DO I VOTE?
A: You may vote your shares either in person or by proxy. To vote by
proxy, you should mark, date, sign and mail the enclosed proxy
card in the postage prepaid envelope. Giving a proxy will not
affect your right to vote your shares if you attend the Annual
Meeting and want to vote in person - by voting in person you will
revoke your proxy. You may also revoke your proxy at any time
before the voting by giving the Company's Secretary written
notice of your revocation or by submitting a later-dated proxy.
If you return your proxy but do not mark your voting preference,
the individuals named as proxies will vote your shares FOR the
election of the nominees for director.
6. Q: WHAT CONSTITUTES A QUORUM?
A: On the record date, Planet Hollywood had approximately
100,140,181 shares of Class A Common Stock, $0.01 par value,
outstanding. In order for the Annual Meeting to be properly held,
a majority of the outstanding shares (a quorum) must be present
at the meeting or represented by proxy.
7. Q: WHAT VOTE IS REQUIRED TO APPROVE EACH PROPOSAL?
A: Election of directors - The affirmative vote of a plurality of
the votes cast at the meeting is required for the election of
directors. A properly executed proxy card marked WITHHOLD
AUTHORITY with respect to the election of one or more directors
will not be voted with respect to the director or directors
indicated, although it will be counted for purposes of
determining whether there is a quorum.
2
<PAGE>
Other items - For each other item, the affirmative vote of a
majority of the shares represented in person or proxy and
entitled to vote on the item will be required for approval. A
properly executed proxy marked ABSTAIN with respect to any such
matter will not be voted, although it will be counted for
purposes of determining whether there is a quorum. Accordingly,
an abstention will have the effect of a negative vote.
8. Q: WHAT IF MY SHARES ARE HELD IN "STREET NAME?"
A: If you hold your shares in "street name" through a broker or
other nominee, your broker or nominee may not be permitted to
exercise voting discretion with respect to some of the matters to
be acted upon. Thus, if you do not give your broker or nominee
specific instructions, your shares may not be voted on those
matters and will not be counted in determining the number of
shares necessary for approval. Shares represented by such "broker
non-votes" will, however, be counted in determining whether there
is a quorum.
9. Q: CAN I VOTE ON OTHER MATTERS?
A: Planet Hollywood's by-laws limit the matters presented at an
annual meeting to those in the notice of the meeting, those
otherwise properly presented by the Board of Directors and those
presented by stockholders so long as the stockholder has given
the Company's Secretary prior written notice of the matter. We do
not currently expect any other matter to come before the Annual
Meeting. If any other matter is presented at the Annual Meeting,
your signed proxy gives the individuals named as proxies
authority to vote your shares.
10 Q: HOW DOES THE BOARD RECOMMEND I VOTE ON THE PROPOSALS?
A: Unless you give other instructions on your proxy card, the
persons named as proxies on the proxy card will vote in
accordance with the recommendations of the Board of Directors.
The Board recommends a vote FOR election of the nominated slate
of directors (see page 4). With respect to any other matter that
properly comes before the meeting, the proxy holders will vote as
recommended by the Board of Directors, or if no recommendation is
given, in their own discretion.
11. Q: WHEN ARE STOCKHOLDER PROPOSALS FOR THE 2000 ANNUAL MEETING DUE?
A: Stockholders interested in presenting a proposal to be considered
for inclusion in next year's proxy statement and form of proxy
may do so by following the procedures prescribed in Rule 14a-8
under the Securities Exchange Act of 1934 and the Company's
by-laws. To be eligible for inclusion, stockholder proposals must
be submitted in writing to the Corporate Secretary, Planet
Hollywood International, Inc., 8669 Commodity Circle, Orlando,
Florida 32819 before December 31, 1999. The deadline for
stockholder proposals which are submitted outside the processes
of Rule 14a-8 will be March 28, 2000, pursuant to Rule 14a-4 of
the Exchange Act and the Company's by-laws.
12. Q: HOW DO I GET COPIES OF THE EXHIBITS FILED WITH THE COMPANY'S
FORM 10-K?
A: A copy of the Company's Annual Report for 1998, which contains
the Company's Form 10-K and consolidated financial statements,
has previously been delivered to you. The Company will provide to
any stockholder as of the Record Date, who so specifically
requests in writing, copies of the exhibits filed with the
Company's Form 10-K. Requests for such copies should be directed
to Scott E. Johnson, Secretary, Planet Hollywood International,
Inc., 8669 Commodity Circle, Orlando, Florida 32819. In addition,
copies of all exhibits filed electronically by the Company may be
reviewed and printed from the SEC's website at:
http://www.sec.gov.
3
<PAGE>
ELECTION OF DIRECTORS
Planet Hollywood's Board of Directors is divided into three classes,
denoted as Class I, Class II and Class III, serving staggered three-year terms
with one class elected each year at the annual meeting. The current Board
consists of:
<TABLE>
<CAPTION>
CLASS I CLASS II CLASS III
(TERM EXPIRING IN 2000)(1) (TERM EXPIRING IN 2001) (TERM EXPIRING IN 1999)
- ---------------------------- ------------------------- ------------------------
<S> <C> <C>
Thomas Avallone Claudio Gonzalez William H. Baumhauer
Mark McCormack Michael Montague Robert Earl
Ong Beng Seng Michael Tarnopol
</TABLE>
- ----------------
(1) Mr. Isadore Sharp, Chairman and Chief Executive Officer of Four Seasons
Hotels, Inc., served as a Class I director for all of fiscal 1998.
Effective April 20, 1999, Mr. Sharp resigned from the Company's Board of
Directors in order to devote more time to his own business endeavors.
Consequently, until the Board fills the vacancy created by Mr. Sharp's
resignation, there are only two Class I directors.
At the 1999 Annual Meeting, you and the other stockholders will elect
three individuals to serve as Class III directors until the 2002 Annual
Meeting. Each of the nominees is now a member of the Board of Directors.
The individuals named as proxies will vote the enclosed proxy for the
election of all nominees unless you direct them to withhold your votes. If any
nominee becomes unable to serve as a director before the Annual Meeting, an
event which is not presently anticipated, discretionary authority may be
exercised by the persons named as proxies to vote for substitute nominees
proposed by the Board. We recommend a vote FOR all nominees.
Below are the names and ages of the directors, the years they became
directors, their principal occupations or employment for at least the past five
years and certain of their other directorships.
<TABLE>
NOMINEES FOR ELECTION FOR A THREE-YEAR TERM (CLASS III DIRECTORS)
<S> <C>
William H. Baumhauer, 50 Mr. Baumhauer was named President and Chief
President and Operating Officer of the Company in July 1998.
Chief Operating Officer He was elected to the Board of Directors in
September 1998. From 1991 until joining the
Company, Mr. Baumhauer was Chairman of the Board
and Chief Executive Officer of Unique Casual
Restaurants, Inc., a publicly traded restaurant
company specializing in casual dining concepts.
In 1996, Mr. Baumhauer received the MUFSO Golden
Chain Award presented by Nation's Restaurant
News for his outstanding achievement and
leadership in the food service industry. Mr.
Baumhauer is a Certified Public Accountant and
serves on the board of advisors of First Chicago
Equity Capital.
</TABLE>
4
<PAGE>
<TABLE>
<S> <C>
Robert Earl, 47 Mr. Earl has over 24 years experience in the
Chairman and restaurant industry. In 1977, Mr. Earl founded
Chief Executive Officer President Entertainment, a company that
developed theme restaurants. Under Mr. Earl's
leadership, over the next ten years, President
Entertainment grew to a $120 million enterprise.
In 1987, Mr. Earl sold President Entertainment
to Pleasurama p.l.c. ("Pleasurama") and joined
the Pleasurama management team, where he assumed
responsibility for the management of another
theme restaurant, Hard Rock Cafe p.l.c. ("Hard
Rock Cafe"). During his five years in charge of
Hard Rock Cafe, Mr. Earl pioneered its expansion
from seven to twenty-two units while
substantially increasing its profitability. In
1993, Mr. Earl resigned from Hard Rock Cafe to
concentrate full time on running the Company. He
has been Chief Executive Officer of the Company
since its inception and a director of the
Company since its organization. In November
1998, Mr. Earl was elected Chairman of the
Board.
Michael Tarnopol, 62 Mr. Tarnopol has been a director of the Company
since June 1996. Mr. Tarnopol has been a Senior
Managing Director and Chairman of the Investment
Banking Division of Bear, Stearns & Co., Inc.
("Bear Stearns") since 1985. Mr. Tarnopol joined
Bear Stearns in 1975 and headed the firms'
International Department from 1975 until 1985,
at which time he was appointed head of the
Mergers & Acquisitions Department of Bear
Stearns. He is Vice Chairman of the Board of
Directors of Bear Stearns and Chairman of Bear
Stearns International, Ltd. Mr. Tarnopol is
currently a director of Avis International, Inc.
and NRT, Inc. He is also a Trustee of the
University of Pennsylvania and a member of the
Board of Overseers of the Wharton School of
Business.
</TABLE>
<TABLE>
<S> <C>
CLASS I DIRECTORS CONTINUING IN OFFICE UNTIL THE 2000 ANNUAL MEETING
Thomas Avallone, 40 Mr. Avallone, Executive Vice President, Chief
Executive Vice President Financial Officer and director of the Company,
and Chief Financial Officer has been involved in the entertainment theme
restaurant industry for over 16 years. From July
1987 until joining the Company in September
1994, Mr. Avallone served as Chief Financial
Officer of Hard Rock Cafe and Rank Leisure USA.
He has been a director of the Company since
February 1996. Prior to serving in those
positions, Mr. Avallone, a certified public
accountant, was a Senior Manager at Laventhol
and Horwath CPAs, a public accounting firm,
specializing in that firm's leisure industry
practice. Mr. Avallone is a member of the
American Institute of Certified Public
Accountants and the New York State Society of
Certified Public Accountants.
Mark McCormack, 68 Mr. McCormack has been a director of the Company
since June 1996. Mr. McCormack is the Chairman
and Chief Executive Officer of the
Cleveland-based sports and entertainment
conglomerate known as International Management
Group, which he founded in 1960. Mr. McCormack
has also authored a number of best-selling
business and management books.
</TABLE>
5
<PAGE>
<TABLE>
<S> <C>
CLASS II DIRECTORS CONTINUING IN OFFICE UNTIL THE 2001 ANNUAL MEETING
Claudio Gonzalez, 64 Mr. Gonzalez has been a director of the Company
since June 1996. Mr. Gonzalez has been the
Chairman and Chief Executive Officer of Kimberly
Clark de Mexico since 1973. Mr. Gonzalez is also
currently a member of the Board of Directors of
Kimberly Clark Corporation, Kellogg Company,
General Electric Company, Banco Nacional de
Mexico, Grupo Televisa, Grupo Carso, Grupo
Industrial Alfa, Telefonos de Mexico, Grupo
Modelo, Unilever, NV & Plc and of J.P. Morgan
International Advisory Board.
Michael Montague, 67 Lord Montague has been a director since 1998 and
is a businessman who has also led a series of
British Government appointed organizations.
These include the English Tourist Board, the
National Consumer Council and the British
National Export Council (Asia). Beginning in
1965 Lord Montague was elected Chairman of Valor
p.l.c., a diversified manufacturing company
("Valor"). In 1987 Valor acquired the American
companies Yale Security, Inc., a lock
manufacturer, and NuTone, Inc., a manufacturer
of intercoms, lighting equipment and extraction
fans (changing its name to Yale and Valor
p.l.c.). In 1991 Yale and Valor p.l.c. merged
with Williams Holdings Ltd. Lord Montague is
currently Chairman of Superframe p.l.c., a
manufacturer of display equipment for
supermarkets, and Acorn Assets, property
developers. He is also a non-executive director
of Jarvis Hotels p.l.c., an operator of 60
hotels in Great Britain. Lord Montague is a
Governor of Oxford Brookes University. In 1970,
Mr. Montague was appointed a Commander of the
British Empire, and in 1997 to the British
Parliament as a Baron for life, with the title
of Lord Montague of Oxford.
Ong Beng Seng, 53 Mr. Ong has been a director of the Company since
February 1996. He is a co-founder and has been a
Managing Director since 1980 of Hotel Properties
Limited ("HPL"), a Singapore publicly-listed
company. HPL has diversified interests in the
hotel, leisure and retail industries, primarily
in Asia. Mr. Ong also has personal diversified
interests ranging from the oil, stock brokering
and automotive industries to art and concert
promotion.
</TABLE>
6
<PAGE>
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors held seven meetings during fiscal 1998. The Board
of Directors also has an Audit Committee, a Compensation Committee and a Stock
Option Committee. The general functions of such committees, the identity of
each current committee member and the number of committee meetings held by each
committee during fiscal 1998 are set forth below.
<TABLE>
<CAPTION>
ATTENDANCE AT BOARD AND COMMITTEE MEETINGS DURING FISCAL 1998
(HELD DURING THE PERIOD FOR WHICH EACH DIRECTOR SERVED)
---------------------------------------------------------
BOARD AUDIT COMPENSATION STOCK OPTION
CURRENT DIRECTORS BY CLASS MEETINGS COMMITTEE COMMITTEE COMMITTEE
- --------------------------- ---------- ----------- -------------- -------------
<S> <C> <C> <C> <C>
Class I
Avallone 7/7 n/a n/a n/a
McCormack 4/7 n/a n/a n/a
Class II
Gonzalez 7/7 4/4 n/a n/a
Montague 5/5 1/1 0/0 n/a
Ong 0/7 0/4 n/a n/a
Class III
Baumhauer 2/2 n/a n/a n/a
Earl 7/7 n/a 0/0 8/8
Tarnopol 7/7 4/4 n/a n/a
</TABLE>
AUDIT COMMITTEE
The current members of the Audit Committee are Messrs. Gonzalez, Montague,
Ong, and Tarnopol. The general functions of the Audit Committee include making
recommendations to the Board regarding the independent auditors, reviewing the
independence of such auditors, approving the scope of the annual activities of
the independent auditors and reviewing audit results. The Audit Committee held
four meetings in fiscal 1998.
COMPENSATION COMMITTEE
The current members of the Compensation Committee are Messrs. Earl and
Montague. Mr. Earl is employed by the Company and serves as its Chairman and
Chief Executive Officer. The general functions of the Compensation Committee
include recommending compensation plans and arrangements with respect to
certain of the Company's executive officers. The Compensation Committee held no
meetings in fiscal 1998. See "Board Compensation Committee Report on Executive
Compensation."
STOCK OPTION COMMITTEE
Through November 1998, the Stock Option Committee consisted of Messrs.
Earl and Barish. Since November 1998, upon Mr. Barish's resignation as Chairman
of the Board,
7
<PAGE>
there has been a single vacancy on the committee. Until such vacancy is filled,
Mr. Earl is the only current member of the Stock Option Committee. The general
functions of the Stock Option Committee include administering the two Stock
Award and Incentive Plans for employees and other persons associated with the
Company. Mr. Earl is not entitled to receive stock options under any of the
Company's benefit plans. The Stock Option Committee held eight meetings in
fiscal 1998.
<TABLE>
<CAPTION>
EXECUTIVE OFFICERS WHO DO NOT SERVE AS DIRECTORS
<S> <C>
John Caparella, Jr., 41 Since November 1998, Mr. Caparella has held the
Vice President of position of Vice President of Development. Prior
Development to that time and since joining the Company in
1997, Mr. Caparella served as the Company's Vice
President of Lodging. Prior to that time, Mr.
Caparella was an executive with ITT Sheraton
Hotels and Resorts for over 16 years
progressively managing larger properties for the
chain and was responsible for successfully
developing from start-up many Sheraton
properties throughout North America.
Ian Hamilton, 42 Mr. Hamilton joined the Company in 1997. Prior
President, Official to that time he was Global Director of Tennis
All Star Cafe Sports Marketing with Nike, Inc. where he helped
to develop Nike's annual worldwide tennis
business. Mr. Hamilton managed Nike's tennis
sports marketing for 13 years, including
advertising, product and athlete marketing. In
connection with the Company's decision to
refocus on its PLANET HOLLYWOOD brand and joint
venture, franchise, sell or otherwise dispose of
its OFFICIAL ALL STAR CAFE concept, Mr. Hamilton
and the Company agreed to the early release of
Mr. Hamilton's employment agreement.
Accordingly, Mr. Hamilton has just recently left
the Company.
Scott E. Johnson, 42 Mr. Johnson has been a Vice President, General
Senior Vice President, Counsel and Secretary of the Company and its
General Counsel and predecessors since joining the Company in March
Secretary 1994. From January 1992 to March 1994, Mr.
Johnson was engaged in the private practice of
law. From May 1990 through January 1992, Mr.
Johnson was Senior Vice President and General
Counsel of Financial Benefit Life Insurance
Company, having previously served as Deputy
General Counsel of Independence Blue Cross
(formerly, Blue Cross of Greater Philadelphia).
Jonathan Guy Laurence, 37 Mr. Laurence joined the Company in January 1998
Senior Vice President of as its Senior Vice President of Marketing and
Marketing and Public Public Relations, Europe. Prior to that time,
Relations, Europe Mr. Laurence served as an Executive Vice
President of Distribution and Marketing for MGM
Studios. In connection with the Company's
decision to refocus its resources on its core
PLANET HOLLYWOOD operations and to cease further
development of certain of its other brands and
brand extensions, Mr. Laurence and the Company
agreed to the early release of Mr. Laurence's
employment agreement in December 1998.
</TABLE>
8
<PAGE>
Nathaniel J. Lipman, 34 Mr. Lipman joined the Company in 1996 after
Executive Vice President, having served as a senior executive and general
Strategic Planning counsel for HOB Entertainment, Inc. ("House of
Blues"), and Senior Corporate Counsel at The
Walt Disney Company. Prior to joining Disney,
Mr. Lipman was a corporate associate with
Skadden, Arps, Slate, Meagher & Flom in Los
Angeles, California. Mr. Lipman oversees and
develops the Company's long-term strategic
direction emphasizing mergers and acquisitions,
including joint ventures, licensing and new
business opportunities. Due to the Company's
recent announcements to refocus its resources on
its core PLANET HOLLYWOOD operations and to
cease further development of certain of its
other brands and brand extensions, Mr. Lipman
has requested the early termination of his
employment agreement, which was set to expire on
September 30, 1999. Mr. Lipman is expected to
leave the Company in the spring of 1999.
George Sautter, 36 Mr. Sautter joined the Company in 1998 as its
Vice President of Vice President of Movie Operations. Prior to
Movie Operations that time, Mr. Sautter served as General Manager
of Cineplex Odeon Corp., one of the world's
largest motion picture exhibitors. Mr. Sautter
has more than 18 years experience in the movie
theater operations business.
Jim Stanley, 48 Mr. Stanley has been in the restaurant business
Senior Vice President for more than 20 years. Prior to joining the
of Operations Company in 1995, Mr. Stanley spent eight years
as Vice President of Operations at Hard Rock
Cafe, and while there was responsible for
overseeing all phases of the development and
operation of units in 18 countries.
9
<PAGE>
STOCK OWNERSHIP
BENEFICIAL OWNERSHIP OF CERTAIN STOCKHOLDERS, DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth information regarding the beneficial
ownership of the Company's Class A Common Stock on February 28, 1999, by:
1. Each current director and nominee to the Board of Directors;
2. Each of the Named Executive Officers (as defined below - see "Executive
Compensation" on page 13);
3. Current directors and executive officers of the Company as a group; and
4. Each person known by the Company to be the beneficial owner of more than
5% of the outstanding shares of Class A Common Stock on February 28,
1999.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL OWNERSHIP OF PERCENT OF
NAME OF BENEFICIAL OWNER CLASS A COMMON STOCK (a) CLASS (%) (a)
- -------------------------------------------------------------------------- -------------------------- --------------
<S> <C> <C>
Directors, nominees and Named Executive Officers
Thomas Avallone (b) (c) ............................................... 226,232 **
William H. Baumhauer (c) .............................................. 0 **
Keith Barish (d) ...................................................... 12,075,567 12.4
Robert Earl (c) (e) ................................................... 22,876,367 23.5
Claudio Gonzalez (f) .................................................. 61,111 **
Ian Hamilton (g) ...................................................... 100,000 **
Scott E. Johnson (c) .................................................. 50,125 **
Jonathan Guy Laurence (h) ............................................. 100,000 **
Nathaniel J. Lipman (c)(i) ............................................ 44,333 **
Mark McCormack (j) .................................................... 16,666 **
Michael Montague (k) .................................................. 26,667 **
Ong Beng Seng / Leisure Ventures Pte, Ltd. (l) ........................ 12,050,335 12.4
Michael Tarnopol (m) .................................................. 26,666 **
Current directors and executive officers as a group
(13 persons) (n) ....................................................... 35,388,669 36.3
Other stockholders owning more than 5%
Kingdom Planet Hollywood, Ltd. (o) .................................... 16,299,237 16.8
</TABLE>
- ----------------
** Represents holdings of less than one percent (1%).
(a) Figures do not include or account for 11,764,144 shares of non-voting Class
B Common Stock outstanding on February 28, 1999. Any Class B shares
beneficially owned by any of the listed
10
<PAGE>
stockholders are noted in the respective footnotes. Of the 11,764,144
shares of non-voting Class B Common Stock outstanding, approximately
5,772,853 may be converted into an equivalent number of shares of Class A
Common Stock at the election of the holder at any time subsequent to April
15, 1999. The remaining shares of non-voting Class B Common Stock shall
continue to be subject to contractual restrictions prohibiting conversion
until at least April 16, 2001. Figures do include and account for certain
options to acquire shares of the voting Class A Common Stock which are
exercisable by the listed stockholders on or before May 31, 1999. Such
options are noted in the stockholders' respective footnotes.
(b) Of Mr. Avallone's 226,232 shares listed above, 202,011 represent shares
held of record by: (i) Avallone Worldwide Enterprises Limited Partnership,
a Nevada limited partnership, in which Avallone Worldwide Enterprises,
Inc., a Nevada corporation wholly owned by Mr. Avallone and his spouse, is
the 1% general partner - Mr. Avallone, jointly with his spouse, is the 93%
limited partner; (ii) Mr. Avallone and his spouse; and (iii) by Mr.
Avallone as custodian for his child. The remaining 24,221 shares listed
represent shares underlying options to acquire such shares which are
exercisable on or before May 31, 1999.
(c) The address for each of these beneficial owners is c/o Planet Hollywood
International, Inc., 8669 Commodity Circle, Orlando, Florida 32819.
(d) Mr. Barish resigned as a director of the Company effective March 24, 1999.
Based on his position as Chairman of the Board in fiscal 1998, however,
Mr. Barish is classified as a Named Executive Officer in this Proxy
Statement. The address for Mr. Barish is c/o Starr & Company, 350 Park
Avenue, New York, N.Y. 10022. The above figure excludes 203,333 shares
held by Mrs. Barish; Mr. Barish disclaims beneficial ownership of such
shares.
(e) Other than 100 shares held individually, all of Mr. Earl's shares are held
of record by Ropat Limited Partnership, a Nevada limited partnership, in
which Ropat, Inc., a Nevada corporation wholly owned by a Revocable
Intervivos Trust for the benefit of Mr. Earl, is the 1% general partner
and such trust is the 99% limited partner. The number of shares listed
above excludes: (1) 38,500 shares held by Shakespeare's Tavern & Playhouse
(London) SARP, a United Kingdom pension plan, and (2) 400,000 shares held
by Celerity Consultants, Ltd, the trustee of a trust, the beneficiaries of
which are the children of Mr. Earl, as to which Mr. Earl disclaims
beneficial ownership. Ropat also owns 1,053,793 shares of the Company's
non-registered, non-voting Class B Common Stock, representing approximately
9.0% of such class. An additional 5,808,851 Class B shares (49.4% of the
class) are owned by Serena Holdings, Ltd., as Trustee of the All Star Cafe
Trust, the beneficiaries of which are Mr. Earl's children. Mr. Earl
disclaims beneficial ownership of the shares held by Serena Holdings, Ltd.
(f) Of the 61,111 shares listed above, 33,333 shares represent shares
underlying options to acquire such shares which are exercisable on or
before May 31, 1999. The address for Mr. Gonzalez is c/o Kimberly Clark de
Mexico, Jose Luis Lagrange, No. 103, 3rd Floor, Colonia, Los Morales,
11510 Mexico, D.F.
(g) Mr. Hamilton is no longer employed by the Company, however, based on his
position as an executive officer of the Company in fiscal 1998, Mr.
Hamilton is classified as a Named Executive Officer in this Proxy
Statement. The address for Mr. Hamilton is 5223 Fairway Oaks, Windermere,
Florida 34786. All of the100,000 shares listed above represent shares
underlying options to acquire such shares which are exercisable on or
before May 31, 1999.
(h) Mr. Laurence is no longer employed by the Company, however, based on his
position as an executive officer of the Company in fiscal 1998, Mr.
Laurence is classified as a Named Executive Officer in this Proxy
Statement. The address for Mr. Laurence is Chainwood House, Gerrards
Cross, Bucks SL98LL England. All of the 100,000 shares listed above
represent shares underlying options to acquire such shares which are
exercisable on or before May 31, 1999.
(i) All 44,333 shares listed above represent shares underlying options to
acquire such shares which are exercisable on or before May 31, 1999.
(j) All 6,666 shares listed above represent shares underlying options to
acquire such shares which are exercisable on or before May 31, 1999. The
address for Mr. McCormack is c/o International
11
<PAGE>
Management Group, IMG Center, 1360 East 9th Street, Suite 100, Cleveland,
Ohio 44114. Mr. McCormack, either directly or indirectly, owns 679,022
shares of the Company's non-registered, non-voting Class B Common Stock,
representing approximately 5.8% of such class.
(k) Of the 26,667 shares listed above, 16,667 shares represent shares
underlying options to acquire such shares which are exercisable on or
before May 31, 1999. The address for Mr. Montague is "River Willows" 67
Abingdon Road, Dorchester-on-Thames, Oxfordshire, OX10 7LB, England.
(l) The shares listed for Mr. Ong are owned of record by Leisure Ventures
Pte., Ltd. ("LV"). The address for Mr. Ong is c/o Kuo Investments Company,
767 Third Avenue, 33rd Floor, New York, N.Y. 10017. LV, formally Planet
Hollywood Holdings Pte., Ltd., is a private Singapore company that is
controlled by Mr. Ong indirectly and HPL, a public Singapore company of
which Mr. Ong is the largest stockholder. Mr. Ong disclaims beneficial
ownership of the shares owned of record by LV. The address for LV is c/o
Kuo Investments Company, 767 Third Avenue, 33rd Floor, New York, N.Y.
10017.
(m) Of the 26,666 shares listed above, 16,666 shares represent shares
underlying options to acquire such shares which are exercisable on or
before May 31, 1999. The address for Mr. Tarnopol is c/o Bear, Stearns &
Co., Inc., 245 Park Avenue, New York, NY 10167.
(n) Of the 35,388,669 shares listed above, 150,886 shares represent shares
underlying options to acquire such shares which are exercisable on or
before May 31, 1999.
(o) According to a Schedule 13G dated February 5, 1999, the address for Kingdom
Planet Hollywood, Ltd., a company organized under the laws of the Cayman
Islands ("KPH"), is c/o Kingdom Holding Company, P.O. Box 8653, Riyadh
11492, Kingdom of Saudi Arabia. Also according to the Schedule 13G, KPH is
indirectly controlled by His Royal Highness Prince Alwaleed Bin Talal Bin
Abdulaziz Al Saud, a citizen of the Kingdom of Saudi Arabia.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under U.S. securities laws, directors, certain executive officers and
persons holding more than 10% of the Company's common stock must report their
initial ownership of the common stock and any changes in that ownership to the
Securities and Exchange Commission. The SEC has designated specific due dates
for such reports and the Company must identify in this Proxy Statement those
persons who did not file such reports when due. Based solely on its review of
copies of the reports filed with the SEC and written representations of its
directors and executive officers, the Company believes all persons subject to
reporting filed the required reports on time in 1998.
12
<PAGE>
EXECUTIVE COMPENSATION
The following table sets forth certain compensation awarded to, earned by
or paid to the Chief Executive Officer, each of the other four most highly
compensated executive officers of the Company serving as executive officers at
the end of the 1998 fiscal year and two additional individuals whom would have
been included as one of such four individuals but for the fact that they were
not serving as an executive officer of the Company at the end of fiscal 1998
(collectively, the "Named Executive Officers"), for services rendered in all
capacities to the Company during fiscal years 1996, 1997 and 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
-------------------------------------------- ------------------------
AWARDS
------------------------
SECURITIES
UNDERLYING
ANNUAL ANNUAL OTHER ANNUAL RESTRICTED OPTIONS/ ALL OTHER
FISCAL SALARY BONUS COMPENSATION STOCK SARS COMPENSATION
NAME AND POSITION YEAR ($) ($) ($) ($) (#) ($)
- ---------------------------- -------- --------- ---------- -------------- ------------ ----------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Robert I. Earl, ............ 1996 500,000 -- 9,972 -- -- --
Chief Executive 1997 600,000 -- 4,419 -- -- --
Officer and Chairman 1998 600,000 -- 6,309 -- -- --
of the Board
Thomas Avallone, ........... 1996 240,000 -- 7,926 -- 62,000 --
Executive Vice 1997 300,000 -- 8,854 -- -- --
President and Chief 1998 375,000 75,000 8,228 -- 100,000
Financial Officer
Nathaniel J. Lipman, ....... 1996 57,742 -- 3,199 -- 100,000 --
Executive Vice 1997 250,000 -- 8,557 -- 30,000 --
President, Strategic 1998 350,000 262,356 10,434 -- 100,000 --
Planning (a)
Ian Hamilton, .............. 1996 n/a n/a n/a n/a n/a n/a
President, Official 1997 201,923 -- 12,108 -- 100,000 79,614(c)
All Star Cafe (b) 1998 250,000 50,000 15,647 -- -- 17,123(c)
Scott E. Johnson, .......... 1996 160,888 -- 6,227 -- 41,000 --
Senior Vice President, 1997 200,000 -- 7,506 -- -- --
General Counsel 1998 250,000 40,385 8,436 -- 70,000 --
and Secretary
Keith Barish, .............. 1996 500,000 -- 9,950 -- -- --
Chairman of the 1997 600,000 -- 13,162 -- -- --
Board (d) 1998 581,539 -- 7,917 -- -- --
Jonathan Guy Laurence, ..... 1996 n/a n/a n/a n/a n/a n/a
Senior Vice President 1997 n/a n/a n/a n/a n/a n/a
of Marketing and 1998 391,930 -- 62,914(f) -- 100,000 517,102(g)
Public Relations,
Europe (e)
</TABLE>
- ----------------
(a) Mr. Lipman was not employed by the Company prior to September 1996.
Accordingly, the compensation figures indicated for 1996 do not represent
a full year's compensation.
(b) Mr. Hamilton was not employed by the Company prior to March 1997.
Accordingly, the compensation figures indicated for 1997 do not represent
a full year's compensation. Mr. Hamilton is no longer employed by the
Company.
(c) All Other Compensation for Mr. Hamilton in 1997 consisted of relocation
expenses paid by the Company. All Other Compensation for Mr. Hamilton in
1998 consisted of housing expenses paid by the Company.
13
<PAGE>
(d) Mr. Barish resigned as Chairman of the Board of Directors effective
November 10, 1998 and therefore did not serve as an executive officer at
fiscal year end 1998. Mr. Barish resigned as a director effective March
24, 1999.
(e) Mr. Laurence was not employed by the Company prior to January 1998. Mr.
Laurence is no longer employed by the Company and did not serve as an
executive officer at fiscal year end 1998.
(f) Other Annual Compensation for Mr. Laurence consisted primarily of pension
related expenses ($41,100) and vehicle related expenses ($18,800).
(g) All Other Compensation for Mr. Laurence represents the aggregate value of
Mr. Laurence's severance arrangement with the Company.
OPTION/SAR GRANTS TABLE
The following table sets forth all grants in fiscal 1998 of stock options
and SARs to the Named Executive Officers.
<TABLE>
<CAPTION>
OPTION/SAR GRANTS IN 1998 FISCAL YEAR
---------------------------------------------------------------
POTENTIAL REALIZABLE
VALUE AT ASSUMED
ANNUAL RATES OF
STOCK PRICE
APPRECIATION
FOR OPTION
INDIVIDUAL GRANTS TERM (5 YEARS)
--------------------------------- -----------------------
NUMBER OF PERCENT OF TOTAL
SECURITIES OPTIONS/SARS
UNDERLYING GRANTED TO
OPTIONS/ EMPLOYEES IN EXERCISE OR
SARS FISCAL YEAR BASE PRICE EXPIRATION 5% 10%
NAME GRANTED (#) (%) ($/SHARE) DATE ($) ($)
- ------------------------------- ------------- ----------------- ------------ ------------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Robert I. Earl ................ 0 0 0 n/a 0 0
Thomas Avallone ............... 100,000 3.3 7.50 2/3/03 207,225 457,875
Nathaniel J. Lipman ........... 100,000 3.3 7.50 2/3/03 207,225 457,875
Ian Hamilton .................. 0 0 0 n/a 0 0
Scott E. Johnson (1) .......... 70,000 2.3 2.50 12/13/03 48,353 106,838
Keith Barish .................. 0 0 0 n/a 0 0
Jonathan Guy Laurence ......... 100,000 3.3 7.50 2/3/03 207,225 457,875
</TABLE>
- ----------------
(1) Mr. Johnson was originally granted 70,000 options in February 1998 at an
exercise price of $7.50 with an expiration date of 2/3/03. In December
1998, Mr. Johnson's options were repriced at an exercise price of $2.50.
See "Report on Repricing of Options/SARs" below.
14
<PAGE>
AGGREGATED OPTION/SAR EXERCISES AND
1998 FISCAL YEAR-END OPTION/SAR VALUE TABLE
The following table sets forth information concerning each exercise of
stock options and SARs during fiscal 1998 by each of the Named Executive
Officers, and the aggregated 1998 fiscal year-end value of unexercised options
and SARs held by such individuals.
AGGREGATED OPTION/SAR EXERCISES AND 1998 FISCAL YEAR-END OPTION/SAR VALUE
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT 1998 OPTIONS/SARS AT
SHARES FISCAL YEAR-END (#) 1998 FISCAL YEAR-END ($)
ACQUIRED ON VALUE ----------------------------- ----------------------------
NAME EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- --------------------------- -------------- ------------- ------------- --------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Robert I. Earl ............ 0 0 0 0 0 0
Thomas Avallone ........... 0 0 24,221 143,112 0 0
Nathaniel J. Lipman ....... 0 0 43,333 186,667 0 0
Ian Hamilton .............. 0 0 33,333 66,667 0 0
Scott E. Johnson .......... 0 0 0 116,333 0 14,542
Keith Barish .............. 0 0 0 0 0 0
Jonathan Guy Laurence ..... 0 0 0 100,000 0 0
</TABLE>
COMPENSATION OF DIRECTORS
Directors who are not compensated as officers of the Company receive
$20,000 in annual fees, with an additional $1,000 payment for each Board
meeting attended and a $500 payment for each Committee meeting. Directors who
are compensated as Company employees receive no additional compensation for
service as a director. The Company will also reimburse each director for
out-of-pocket expenses incurred in attending meetings of the Board of Directors
and its committees. All directors, except Mr. Earl, are eligible to receive
stock options. In fiscal 1998, the following directors (other than the Named
Executive Officers) received stock options:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING OPTIONS EXERCISE PRICE
NAME GRANTED (#) ($/SHARE) EXPIRATION DATE
- ---------------------------------- --------------------- --------------- ----------------
<S> <C> <C> <C>
William H. Baumhauer (1) ......... 750,000 2.50 12/13/03
Michael Montague (2) ............. 50,000 7.94 6/3/03
</TABLE>
- ----------------
(1) Mr. Baumhauer's options were originally granted in August 1998 in
connection with his employment by the Company at an exercise price of
$5.00 and an expiration date of 8/11/03. In December 1998, Mr. Baumhauer's
options were repriced to an exercise price of $2.50. See "Report on
Repricing of Options/SARs" below.
(2) Mr. Montague's options were granted in connection with Mr. Montague's
election as a director of the Company.
15
<PAGE>
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT
AND CHANGE-IN-CONTROL ARRANGEMENTS
The Company is party to an employment agreement with Mr. Earl originally
entered into as of August 8, 1995 providing for his employment as Chief
Executive Officer of the Company and its significant subsidiaries and
affiliates, including Official All Star Cafe, through December 31, 2001. The
agreement currently provides for a base salary of $600,000 per year with annual
increases of at least 10%, an annual incentive bonus in the discretion of the
Board of Directors of the Company, participation in the Company's stock-based
incentive compensation plan for executives and employees and all benefits
generally made available to executive officers of the Company. The agreement
further provides that Mr. Earl must devote substantially all of his productive
time and attention to the business of the Company and that he may not own or
participate in the activities of any competing business, although Mr. Earl is
entitled to retain his existing ownership in, and remain involved in the
management of, The Pelican Group p.l.c. as well as WILD JACK'S restaurants. The
Company has the right to terminate the agreement without any further obligation
in the event (i) Mr. Earl resigns from the Company, (ii) he willfully breaches
the agreement or (iii) he is convicted, of or pleads guilty to, a felony
involving moral turpitude or certain crimes involving the Company's property.
Mr. Earl is entitled to terminate the agreement in the event he is not elected
or retained in his present positions at the Company or the Company materially
reduces his responsibilities. In the case of such termination, or if the
agreement is terminated by the Company without cause or upon Mr. Earl's death
or disability, he will be entitled to receive the remainder of his base salary,
all incentive bonuses granted and all options awarded under the stock incentive
plan. The agreement includes a non-competition provision prohibiting Mr. Earl
for a period of two years following the termination of his employment with the
Company in most circumstances from working for any company that operates
restaurants with a movie, sports or action hero theme.
The Company is party to an employment agreement with Mr. Avallone dated
January 1, 1998 providing for his employment as Executive Vice President and
Chief Financial Officer through January 1, 2001, with such term automatically
renewing for additional one-year periods unless either party provides notice to
the other of its unwillingness to renew. The agreement currently provides for a
base salary of $375,000, with additional bonuses and salary increases to be
determined by the Board of Directors. The agreement may be terminated by the
Company for cause in the event (i) Mr. Avallone is convicted of, or pleads
guilty to, a crime involving moral turpitude or certain other crimes involving
the Company's property, or (ii) he willfully breaches the agreement. If the
Company terminates the agreement for any reason other than cause, Mr. Avallone
will be entitled to receive his base salary for the following twelve month
period and shall become fully vested in all his stock options. Mr. Avallone is
entitled to terminate the agreement in the event of a material breach thereof
by the Company after giving the Company notice and an opportunity to cure the
breach or in the event that Mr. Avallone no longer reports to Mr. Earl. In the
case of any such termination, he will be entitled to receive his base salary
for the following twelve month
16
<PAGE>
period and he shall become fully vested in all his stock options. The agreement
also contains customary non-disclosure and non-competition provisions.
The Company is party to an employment agreement with Mr. Lipman dated
October 1, 1996 providing for his employment as Executive Vice President,
Strategic Planning through September 30, 1999. The agreement currently provides
for a base salary of $350,000, with additional bonuses and salary increases to
be determined by the Board of Directors. Due to the Company's recent
announcements to refocus its resources on its core PLANET HOLLYWOOD operations
and to cease further development of certain of its other brands and brand
extensions, Mr. Lipman has requested the early termination of his employment
agreement and is expected to leave the Company in the spring of 1999. Pursuant
to the terms of Mr. Lipman's severance arrangement with the Company, Mr. Lipman
is entitled to receive his base salary through September 1999 and to become
fully vested in certain of his stock options.
The Company was party to an employment agreement with Mr. Hamilton dated
January 7, 1997 providing for his employment as President of the Company's
subsidiary, All Star Cafe, Inc. through February 28, 2000. The agreement
provided for a base salary of $250,000, with a minimum bonus of $50,000 per
year, payable in cash or stock options and such additional bonuses and salary
increases as determined by the Board of Directors. In connection with the
Company's decision to refocus on its PLANET HOLLYWOOD brand and joint venture,
franchise, sell or otherwise dispose of its OFFICIAL ALL STAR CAFE concept, Mr.
Hamilton and the Company agreed to the early release of Mr. Hamilton's
employment agreement and Mr. Hamilton has recently left the Company. Pursuant
to the terms of Mr. Hamilton's severance arrangement with the Company, Mr.
Hamilton is entitled to receive his base salary and minimum bonus through
February 2000 and has become fully vested in certain of his stock options.
The Company is party to an employment agreement with Mr. Johnson dated May
1, 1996 providing for his employment as Senior Vice President, General Counsel
and Secretary through February 28, 2000, with such term automatically renewing
for additional eighteen-month periods unless either party provides notice to
the other of its unwillingness to renew. The agreement currently provides for a
base salary of $250,000, with additional bonuses and salary increases to be
determined by the President and/or Chief Executive Officer, and for Mr.
Johnson's participation in the Company's employee benefit plans. The agreement
may be terminated by the Company for cause in the event (i) Mr. Johnson is
convicted of, or pleads guilty to, a crime involving moral turpitude or certain
other crimes involving the Company's property, (ii) he willfully breaches the
agreement or (iii) has his license to practice law revoked. Mr. Johnson is
entitled to terminate the agreement in the event of a material breach thereof
by the Company after giving the Company notice and an opportunity to cure the
breach. In the case of such termination, he will be entitled to receive his
base salary and benefits for one year. The agreement also contains customary
non-disclosure and non-competition provisions.
17
<PAGE>
Mr. Barish resigned as Chairman of the Board effective November 10, 1998,
at which time his employment agreement terminated. In connection with such
resignation, the Company and Mr. Barish entered into certain agreements
providing for the registration of a portion of Mr. Barish's shares of the
Company's common stock. The Company paid for all expenses associated with such
registration in fiscal 1999. Copies of the agreements with Mr. Barish, as
amended, have been filed with the SEC. Reference is made to Exhibits 10.1 and
10.2 in the Registration Statement on Form S-3, as amended, previously filed by
the Company (file no. 333-67467) and Exhibits 99.1 and 99.2 in the Current
Report on Form 8-K dated February 23, 1999, previously filed by the Company on
February 23, 1999.
The Company was party to an employment agreement with Mr. Laurence dated
April 11, 1997 providing for his employment commencing January 1, 1998 as
Senior Vice President of Marketing and Public Relations, Europe through January
1, 2003. The agreement provided for a base salary of $400,000, with additional
bonuses and salary increases of at least $25,000 per year determined by the
Board of Directors. In connection with the Company's decision to refocus its
resources on its core PLANET HOLLYWOOD operations and to cease further
development of certain of its other brands and brand extensions, Mr. Laurence
and the Company agreed to the early release of Mr. Laurence's employment
agreement in December 1998. Pursuant to the terms of Mr. Laurence's severance
arrangement with the Company, Mr. Laurence received an amount equal to his base
salary and benefits for the following twelve month period and has become fully
vested in certain of his stock options. See "Summary Compensation Table" above.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company is party to a license agreement with Planet Hollywood (Asia)
Pte. Ltd. ("PH Asia") (a Singapore corporation which is 50% owned by each of
the Company and Leisure Ventures Pte. Ltd., a Singapore corporation 50% owned
by each of the Company's director Mr. Ong and Hotel Properties Limited, a
Singapore public company of which Mr. Ong is the largest stockholder). Pursuant
to the license agreement, as amended (the "License Agreement"), PH Asia has the
rights to license and develop PLANET HOLLYWOOD units throughout most of Asia
and certain other countries throughout the world and to receive franchise fees
and continuing royalties in respect to the operation of any such units. During
fiscal 1998, PH Asia did not open any units. From time to time Leisure Ventures
Pte. Ltd. or its affiliates purchase merchandise from the Company. In fiscal
1998, such purchases totaled approximately $0.1 million.
The Company is party to a master franchise agreement with ECE, S.A. de
C.V., a publicly-traded Mexican company ("ECE") in which the Company is a 20%
stockholder. Mr. Claudio Gonzalez (a director of the Company) is one of ECE's
principal stockholders and the Chairman of its Board of Directors. ECE is
currently operating, and has rights to open, PLANET HOLLYWOOD and OFFICIAL ALL
STAR CAFE units in certain international markets, including Mexico and South
America. ECE is obligated to pay continuing royalties to the Company consistent
with the Company's standard franchise arrangements, based on a
18
<PAGE>
percentage of the total revenues from its units. During fiscal 1998 ECE did not
open any units. From time to time ECE or its affiliates purchase merchandise
from the Company. In fiscal 1998, such purchases totaled approximately $0.2
million.
The Company is party to a master franchise agreement with Kingdom Planet
Hollywood, Ltd. ("Kingdom"), an affiliate of HRH Prince Alwaleed Bin Talal
Abdulaziz Al Saud of Saudi Arabia and a significant stockholder of the Company,
pursuant to which Kingdom may develop 40 or more PLANET HOLLYWOOD units in a
total of 23 countries throughout the Middle East and Europe. During fiscal
1998, Kingdom entered into certain transactions with the Company relating to
the formation and operation of three corporations to be owned equally by
Kingdom and the Company. Those corporations will own and operate PLANET
HOLLYWOOD units in Tokyo, Japan and Zurich, Switzerland and an OFFICIAL ALL
STAR CAFE unit in London, England. In connection therewith, the Company
received approximately $4.3 million in cash and $1.0 million in the form of a
note receivable from Kingdom from the sale of 50% of the Company's interest in
the three corporations. The Zurich PLANET HOLLYWOOD unit is currently
operating, however, the Company may have difficulty meeting its obligations in
connection with the development of restaurants in Tokyo and London. In
addition, in November 1998 the Company granted Kingdom the right to develop a
number of OFFICIAL ALL STAR CAFE and SOUND REPUBLIC units in 23 countries
throughout the Middle East and Europe. From time to time Kingdom or its
affiliates purchase merchandise from the Company. In fiscal 1998, such
purchases totaled approximately $1.3 million.
In fiscal 1997, in connection with the employment of Mr. Ian Hamilton, the
Company loaned Mr. Hamilton approximately $500,000 at an interest rate of
approximately 7%, the proceeds of which were used exclusively as payment
against the purchase price of Mr. Hamilton's permanent residence in Orlando,
Florida. The loan is secured by Mr. Hamilton's stock options in the Company and
his residence. The loan must be repaid in full on or before June 8, 1999. In
connection with Mr. Hamilton's recent departure from the Company, Mr.
Hamilton's severance arrangement with the Company, as described above, is
contingent on repayment of the loan. As of February 28, 1999, the outstanding
balance of the loan, including accrued interest, was approximately $521,000.
In fiscal 1998, the Company paid approximately $2.6 million in investment
banking fees for services rendered by Bear Stearns & Co., Inc., a firm in which
Mr. Tarnopol, a director of the Company, is affiliated and also a member of
that firm's board of directors. Such fees primarily consisted of fees
associated with the Company's issuance of $250.0 million of Senior Subordinated
Notes in March 1998.
19
<PAGE>
REPORT ON REPRICING OF OPTIONS/SARS
The following table sets forth information regarding all repricing of
options and SARs in fiscal 1998 held by any Named Executive Officer. In fiscal
1995, 1996 and 1998 Mr. Johnson was issued stock options to purchase 5,333,
41,000 and 70,000 shares, respectively, at exercise prices between $7.50 and
$21.63 per share. In December 1998, based on Company's stock price and the
Stock Option Committee's aim of retaining and motivating employees, the Stock
Option Committee decided to reprice such options in order to increase the
incentive of Mr. Johnson to increase stockholder value. The options were
repriced at the then current market price of $2.50.
<TABLE>
<CAPTION>
NUMBER OF LENGTH OF
SECURITIES MARKET PRICE ORIGINAL
UNDERLYING OF STOCK AT EXERCISE PRICE OPTION TERM
OPTIONS/SARS TIME OF AT TIME OF NEW REMAINING
REPRICED OR REPRICING OR REPRICING OR EXERCISE AT DATE OF
REPRICING AMENDED AMENDMENT AMENDMENT PRICE REPRICING OR
NAME AND POSITION DATE (#) ($) ($) ($) AMENDMENT
- ---------------------------- ----------- -------------- -------------- ---------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Scott E. Johnson, .......... 12/14/98 5,333 2.50 7.88 2.50 21 months
Senior Vice President, 12/14/98 21,000 2.50 21.63 2.50 36 months
General Counsel and 12/14/98 20,000 2.50 19.00 2.50 34 months
Secretary 12/14/98 70,000 2.50 7.50 2.50 50 months
</TABLE>
The following table sets forth information regarding all repricing of
options and SARs through fiscal 1998 held by any executive officer since the
Company became a reporting company pursuant to Section 13(a) or 15(d) of the
Exchange Act (except as noted in the table above).
<TABLE>
<CAPTION>
NUMBER OF LENGTH OF
SECURITIES MARKET PRICE EXERCISE ORIGINAL
UNDERLYING OF STOCK AT PRICE AT OPTION TERM
OPTIONS/SARS TIME OF TIME OF NEW REMAINING
REPRICED OR REPRICING OR REPRICING OR EXERCISE AT DATE OF
REPRICING AMENDED AMENDMENT AMENDMENT PRICE REPRICING OR
NAME AND POSITION DATE (#) ($) ($) ($) AMENDMENT
- ----------------------------- ----------- -------------- -------------- -------------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
Thomas Avallone, ............ 10/31/96 20,000 19.00 22.63 19.00 57 months
Executive Vice
President and Chief
Financial Officer
Scott E. Johnson, ........... 10/31/96 20,000 19.00 22.63 19.00 57 months
Senior Vice President
General Counsel
and Secretary
William H. Baumhauer, ....... 12/14/98 750,000 2.50 5.00 2.50 56 months
President and Chief
Operating Officer
John Caparella, Jr., ........ 12/14/98 35,000 2.50 7.50 2.50 50 months
Vice President of
Development
Jim Stanley, ................ 12/14/98 12,700 2.50 7.88 2.50 21 months
Senior Vice President 12/14/98 120,000 2.50 7.50 2.50 50 months
of Operations
</TABLE>
STOCK OPTION COMMITTEE:
ROBERT I. EARL, Director
20
<PAGE>
INSIDER PARTICIPATION IN COMPENSATION DECISIONS AND
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee, which is currently composed of Mr. Earl, the
Company's Chairman of the Board and Chief Executive Officer, and an outside
independent director, Mr. Montague held no meetings in fiscal 1998. In December
1998, the Board of Directors determined that the Compensation Committee shall
review, evaluate and approve the design and implementation of the Company's
compensation system for two executive officers - the Chairman of the Board and
the President and Chief Operating Officer. All other compensation decisions
will be proposed by the Company's human resources department and approved by
the President and Chief Operating Officer. Prior to the Board's decision in
December, the Compensation Committee reviewed the compensation of the Chairman
of the Board, Chief Executive Officer, Chief Financial Officer and General
Counsel.
For purposes of making compensation determinations, the Compensation
Committee uses broad-based industry surveys of what executives with comparable
responsibilities are paid and evaluates individual performance. The Company
strives to provide a comprehensive executive compensation system that is
competitive and performance-based in order to attract and retain superior
executive talent. The Company's current compensation package includes a mix of
base salary, short-term and long-term incentive opportunities and other
employee benefits. Changes in compensation are based on an individual's
performance, the Company's performance and the competitive marketplace.
During fiscal 1997, both Mr. Earl, then President and Chief Executive
Officer of the Company, and Mr. Barish, then Chairman of the Board of
Directors, received a base salary of $600,000 pursuant to their respective
employment agreements with the Company. In fiscal 1998, both Mr. Earl and Mr.
Barish waived certain compensation increases due each of them pursuant to said
employment agreements. Furthermore, no bonuses were paid, nor were any stock
options granted, to either of these officers based on the Company's performance
and a determination by the Compensation Committee that the base compensation
for these individuals coupled with the number of shares of Class A Common Stock
held by each of these individuals provided an adequate incentive to these
individuals to increase stockholder value. Mr. Earl's overall compensation
reflects the extent of his policy and decision-making authority and his level
of responsibility with respect to the strategic direction and financial and
operational results of the Company.
With respect to Mr. Avallone, the Company's Chief Financial Officer, and
Mr. Scott E. Johnson, the Company's General Counsel, the Compensation Committee
previously approved increases in their base compensation and bonuses based on
their individual performance and prevailing compensation rates for executives
holding similar positions. Mr. Lipman's increase in base compensation and bonus
in fiscal 1998 was also based on his individual performance and prevailing
compensation rates for executives holding similar positions. Mr. Hamilton
received a bonus in fiscal 1998 in accordance with the terms of his employment
agreement.
21
<PAGE>
The Compensation Committee intends to review the performance of the
Chairman of the Board and the President and Chief Operating Officer during the
current fiscal year, and to reward performance through cash bonuses or other
incentive compensation at the committee's discretion. In that regard, the
qualitative factors that the committee will use are Company performance,
managerial vision, decision-making acumen, effectiveness, teamwork and the
results obtained by senior management.
COMPENSATION COMMITTEE:
ROBERT I. EARL, Director
MICHAEL MONTAGUE, Director
22
<PAGE>
STOCK PERFORMANCE GRAPH
The following line graph compares the total returns (assuming reinvestment
of dividends) of the Company's Class A Common Stock, the Nasdaq Composite
Index, Standard & Poor's 500 Index, the Russell 2000 Index and the Russell 2000
Consumer Discretionary and Services Index for the period beginning April 19,
1996 (the date of the Company's initial public offering) and ending December
27, 1998 (the close of the Company's 1998 fiscal year). The graph assumes $100
invested on April 19,1996 in the Company's Class A Common Stock (at the initial
public offering price of $18.00 per share) and each of the indices.
[GRAPH OMITTED]
<TABLE>
<CAPTION>
PLANET RUSSELL 2000
HOLLYWOOD NASDAQ STANDARD & RUSSELL CONSUMER
CLASS A COMPOSITE POOR'S 500 2000 DISCRETIONARY AND
DATE COMMON STOCK INDEX (a) INDEX (b) INDEX (c) SERVICES INDEX (d)
- ---- -------------- ----------- ------------ ---------- ------------------
<S> <C> <C> <C> <C> <C>
04/19/96 - IPO 100.00 100.00 100.00 100.00 100.00
06/30/96 - End of 2nd Quarter 150.00 104.35 104.20 103.01 106.57
09/29/96 - End of 3rd Quarter 156.00 108.37 106.52 103.09 104.19
12/29/96 - End of 4th Quarter 115.80 113.84 116.81 107.61 100.53
03/30/97 - End of 1st Quarter 100.00 110.60 119.07 105.17 98.97
06/29/97 - End of 2nd Quarter 126.04 125.69 133.72 117.61 114.06
09/28/97 - End of 3rd Quarter 107.29 142.56 146.25 131.97 126.64
12/28/97 - End of 4th Quarter 69.79 132.40 145.62 127.35 119.14
03/29/98 - End of 1st Quarter 59.48 161.21 170.80 142.00 143.46
06/28/98 - End of 2nd Quarter 40.64 166.40 175.77 135.12 141.84
09/27/98 - End of 3rd Quarter 21.62 148.75 157.66 107.41 107.68
12/27/98 - End of 4th Quarter 14.53 192.56 190.56 124.65 131.72
</TABLE>
- ----------------
(a) The Nasdaq Composite Index is a broad-based capitalization-weighted index
of all Nasdaq stocks. This index is presented because the Company's Class
A Common Stock was traded on the Nasdaq National Market from April 19,
1996 through Friday, September 19, 1997. Beginning
23
<PAGE>
Monday, September 22, 1997, the Class A Common Stock has been traded on the
New York Stock Exchange under the symbol "PHL."
(b) The Standard & Poor's 500 Index is a capitalization-weighted index of 500
stocks designed to measure performance of the broad domestic economy
through changes in the aggregate market value of 500 stocks representing
all major industries. The index was developed with a base level of 10 for
the 1941-43 base period.
(c) The Russell 2000 Index is comprised of the smallest 2000 companies in the
Russell 3000 Index, representing approximately 11% of the Russell 3000
total market capitalization.
(d) The Russell 2000 Consumer Discretionary and Services Index is a
capitalization-weighted index of companies that manufacture products and
provide discretionary services directly to consumers.
AUDITORS
The Audit Committee of the Board of Directors recommended and the Board
has selected the firm of PricewaterhouseCoopers LLP to continue as the
Company's independent public accountant for the current fiscal year . A
representative of PricewaterhouseCoopers LLP is expected to attend the Annual
Meeting to respond to questions and will be given the opportunity to make a
statement should the representative desire to do so.
OTHER BUSINESS
Management knows of no other business to be presented for action at the
meeting. If other matters properly come before the meeting or any adjournment
thereof, the persons named as proxies will vote upon them in accordance with
their best judgment.
By Order of the Board of Directors,
Orlando, Florida SCOTT E. JOHNSON
April 28, 1999 Secretary
PLEASE DATE AND SIGN THE
PROXY CARD AND RETURN IT PROMPTLY
USING THE ENCLOSED RETURN ENVELOPE
24
<PAGE>
PROXY
PLANET HOLLYWOOD INTERNATIONAL, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR ANNUAL MEETING OF STOCKHOLDERS,
MAY 27, 1999
The undersigned hereby appoints Robert I. Earl and Scott E. Johnson and
each of them, jointly and severally, with power of substitution, to vote on all
matters which may properly come before the 1999 Annual Meeting of Stockholders
of Planet Hollywood International, Inc., or any adjournment thereof.
<TABLE>
<S> <C> <C>
ELECTION { } FOR all nominees listed below { } WITHHOLD AUTHORITY
OF DIRECTORS. (except as marked to the contrary to vote for all nominees listed
below). below.
</TABLE>
NOMINEES: Robert Earl, William H. Baumhauer and Michael Tarnopol
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE,
STRIKE A LINE THROUGH OR OTHERWISE STRIKE THE NOMINEE'S NAME IN THE LIST ABOVE.
{ } If you plan to attend the Annual Meeting, please check here
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
THE UNDERSIGNED STOCKHOLDER. UNLESS OTHERWISE SPECIFIED, THE SHARES WILL BE
VOTED FOR THE ELECTION OF ALL NOMINEES TO THE COMPANY'S BOARD OF DIRECTORS.
____________________________________ Date: _______________
____________________________________ Date: _______________
Signatures of Stockholder(s)
NOTE: Signature should agree with name on stock certificate as printed hereon.
Executors, administrators, trustees and other fiduciaries should so indicate
when signing.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY
THANK YOU
